Case Note & Summary
The appellant, Videocon Industries Ltd., a manufacturer of LCD TVs, had been regularly importing Liquid Crystal Device – Thin Film Transistor Modules (LCD TFT). The appellant claimed classification under tariff head 9013 80 10 of the Customs Tariff Act, 1975, and benefit of exemption under Notification No.24/05. The Customs Authorities classified the goods under tariff head 8529 90 90. The Commissioner of Customs (Appeals) upheld the classification. On further appeal, CESTAT by order dated 23.2.2009 held that the LCD TFT imported by the appellant are classifiable under tariff head 9013 80 10 as claimed by the appellant. The Revenue's appeal against that order is pending before the Supreme Court. The present dispute relates to imports during August 2006 to April 2008. The Assessing Officer passed Orders in Original classifying the goods under tariff head 8529 90 90. The Commissioner of Customs (Appeals) upheld that order on 19.2.2008. The appellant filed further appeals before CESTAT along with a Stay Application. By the impugned order dated 28.6.2010, CESTAT declined to follow its earlier order dated 23.2.2009 in view of changes in the Tariff Heading introduced by the Finance Act 2006 and directed the appellant to deposit Rs. 5 crores. The appellant challenged this order before the High Court. The High Court admitted the appeal on the substantial question of law regarding the justification of the pre-deposit direction. The High Court held that the Tribunal's discretion to impose pre-deposit must be exercised consistently with its earlier orders on similar issues. Since the earlier order dated 23.2.2009 had decided the classification in favour of the appellant and granted full waiver, and that order had not been reversed or modified, the Tribunal erred in directing pre-deposit. The High Court set aside the impugned order and directed CESTAT to hear the appeals without insisting on any pre-deposit.
Headnote
A) Customs Law - Pre-deposit - Section 129E of Customs Act, 1962 - Discretion of Tribunal - The Tribunal must exercise its discretion to impose pre-deposit consistently with its earlier orders on similar issues, especially when the classification dispute is identical and the earlier order granting full waiver has not been reversed or modified. Held that the Tribunal erred in directing pre-deposit of Rs. 5 crores without considering its earlier order dated 23.2.2009 which had decided the classification in favour of the appellant and granted full waiver. (Paras 1-6)
Issue of Consideration
Whether the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) was justified in directing the appellant to make a pre-deposit of Rs. Five Crores for entertaining the appeal, when in respect of similar appeals filed by the appellant in the past, the Tribunal had granted full waiver of pre-deposit.
Final Decision
Appeal allowed. Impugned order dated 28.6.2010 set aside. CESTAT directed to hear the appeals without insisting on any pre-deposit.
Law Points
- Pre-deposit under Section 129E of Customs Act
- 1962
- Discretion of Tribunal
- Consistency in judicial orders
- Prima facie case
- Balance of convenience
